Accenture Case Study

 

The Problem

 

As Accenture began the total overhaul of their IT systems they realized two things.

 

·         First, the complete overhaul they chose for a complete transformation of the IT infrastructure turned out to be very effective. Very few organizations could complete such a massive task so quickly. As an organization that  consults clients on simplifying processes and technology whenever possible, while maintaining state-of-the-art technology this decision showed clients that Accenture believed in what they sold to its clients.

·         Secondly, Accenture was strongly considering another upgrade to enhance its business intelligence (BI) as well as a total management of their ERP system. The framework software that Accenture was considering for the upgrade was COBIT 5. Even with its current IT system Accenture had to consider its financial reporting systems among many regulations globally. Besides regulations COBIT 5 could possibly enhance Accenture's IT systems’ ability to communicate causing greater integration and sound business decisions.

 

The IT overhaul of the IT system focused in on four key areas:

 

·         Redefining IT at Accenture from a cost center to a profit center

·         Reducing IT cost by the implementation of a web-enabled technology solution

·         Greater IT governance and oversight based on key strategic business objectives

·         A single-vendor/platform approach to software eliminating the need for multiple suppliers

 

Solutions

 

Accenture is ultimately considering two solutions:

 

·         Continue with the current IT framework

o   Would ensure that Accenture would be maintaining the system that made them so successful from 2001 to today

o   Decreased IT spending by 58% (60% decrease of IT spend/employee) while nearly doubling revenues at the same time.

o   Local applications had been cut by 87% from the levels they were in 2001 before the upgrade while also maintaining high levels of satisfaction among employees internally and earning praise from external stakeholders.

o   The ability to continue the use of a decreased number of suppliers and applications needed to conduct business operations

o   Could also continue to lean on their existing value chain and reporting systems that virtually revolve around the clock while ‘following the sun.’

·         Structure or implement COBIT 5 standards.

o   High investment and change in current practices already in place.

o   Many similarities to their current IT model, with several practices that seem to overlap.

o   Could create efficiencies, control, and flexibility in key IT areas

§  Plan & organize

§  Acquire& implement

§  Delivery & support

§  Monitor & evaluate

o   Has proven practices that minimize unwarranted software’s and applications and an overall reduction of IT spending.

o   A main cost is training for employees.

§  Roughly $175/employee for materials

§  Another $1,500 for the two day class.

o   Employee downtime and travel expenses.

o   Time to implement and master the practices learned within the classroom and transfer to every day practices.

 

Recommendation

 

Considering the investment needed along with the risk I believe it is not in the best interest of the organization to implement COBIT 5.

·         Investment could exceed $20 million in costs, training, and loss of productivity

·         Potential backlash from stakeholders who have taken an interest in Accenture’s industry standard IT systems and processes

·         The current model already has in place a number of the best practices and standards--implementing COBIT 5 would duplicate this.

o   The one-vendor and single-platform approach has been in place and has already streamlined processes and reduced costs significantly.

o   COBIT 5 seeks control over IT governance and regulations however Accenture has these areas covered.

§  Project sponsors who see a project through all phases as well as a ROI auditing process

§  Linking IT processes to the objectives of the business through processes such as IT support on a per needs basis through an ‘internal customer’ and their need for the support.

I believe that the upgrade is not warranted at this time as number of the key functions of COBIT 5 has already been in place since the overhaul in 2001. Though COBIT 5 provides insights into continually evolving our IT structure but the implementation is not a practical choice at this time due to the high investment.